Afghanistan said on Tuesday that the extremism and terrorism in the South Asia region must be banned in all forms, including its political sponsorship and funding.

Speaking at the SAARC summit, Afghanistan President Hamid Karzai said the progress of the entire region would come to a standstill and security would be compromised if significant steps were not taken in this direction.

"It is our duty to ban extremism and terrorism in all forms and sources, including political sponsorship and financing," Karzai said.

"Should we fail in this regard, the progress will be hindered in the entire region and the security will be compromised further," he said.

"We would have failed in our responsibility to impart prosperity and security to our sons and daughters," he said.

Linking extremism and foreign interference in Afghanistan in the past with two decades of its political and economic isolation in the region, Karzai said terrorism had 'detrimental consequences for all of us' in the region and in the international community.

Karzai said Afghanistan paid a heavy price in the past in this regard and, as a new member, looked up to SAARC for the development of his country and region.

"Afghanistan's political and economic isolation should never be repeated. Instead a trans-economic cooperation must be pursued for the sake of economic and regional stability," he said.

Calling for stronger cooperation between the SAARC countries, Karzai said, "Challenges must be overcome to realise the potential of a greater regional economic integration."

Transit and transport facilities should be put in place for easier movement of people and goods between the countries, he said.

Observing that a model transportation system was a 'key priority' for SAARC, the Afghanistan President said the region should be linked with rail and road system and airlines and airports too should be interlinked for the sake of development.

"Particular attention should be directed to (develop) transportation system for the landlocked countries of SAARC," he said.

Referring to South Asia Free Trade Agreement, the karzai said we 'must not allow narrowly defined interests' to deprive 'us of the benefits of free growing trade in the region'.

"Our productive efforts are required for successful implementation of SAFTA agreement in this regard," Karzai said.